please help verify IB unbundled commission calculations

J

jimrockford

I am trying to verify the correctness of the unbundled commissions I have been charged by IB, and I am having trouble doing so. Can somebody tell me what is wrong?

I sold, for example, 200 shares of SPY, at a price of 126.39, on INET, and I was offering liquidity. I calculate that my basic commission should have been 70 cents, plus about 80 cents for the SEC fees, and minus a 40 cents rebate for offering liquidity on an ETF. This comes to a total of $1.10. BUT I was actually charged $1.45.

Where am I going wrong? Could it be that I did not receive the rebate? Are my calculations incorrect?
 
Tell me about it. I wish IB would offer a breakdown of the fees they are charging and crediting. As it is, there is no way to verify if you are being charged correctly or not. I have a system that auto trades through IB. I don't know if i was offering or taking liquidity. Would be nice to see a breakdown on my statements.
 
This is exactly why I have not switched over to the unbundled commission event though it would probably save me some money.

I like to keep meticulous records of all my trades and there is no way to accurately calculate your commissions right now.
 
Jim, I think you may have to add NASD fee when applicable as well as IB's clearing fee. Besides, if the order was sent through SMART routing, the SMART router might have re-routed back and forth part of that 200 shares that may cause your not offering 100% liquidity.
 
GTC,

Thanks for your two ideas, but neither one of them can explain the apparent discrepancy.

I omitted mention of the NASD fee, because I reckon that even if it applies to a SPY order, it is only a tiny fraction of a penny for this entire particular order (the entire order, not just per share). Do you reckon it would be a larger amount?

I also did not SMART-route the order. I direct-routed it to INET. So the routing cannot explain the discrepancy. But thanks for trying!

Anybody else? Any ideas?
 
Quote from jimrockford:

GTC,

Thanks for your two ideas, but neither one of them can explain the apparent discrepancy.

I omitted mention of the NASD fee, because I reckon that even if it applies to a SPY order, it is only a tiny fraction of a penny for this entire particular order (the entire order, not just per share). Do you it would be a larger amount?

I also did not SMART-route the order. I direct-routed it to INET. So the routing cannot explain the discrepancy. But thanks for trying!

Anybody else? Any ideas?
More...

I have one: try contacting the helpdesk; they should be able to look up exactly how the charge was computed.
 
Thanks, IBSoft,

and of course, I already submitted my trouble ticket first thing this morning. I don't want to phone the help desk on this issue, because I realize that phone contact creates an extra burden on the helpdesk. This is why I am waiting for a response to my trouble ticket.

The reason I also posted my question is that my experience indicates that it is best to collect as much information, and to do as much research as I can, prior to getting a helpdesk response. This prepares me to question their response if it seems doubtful, and it helps everybody reach the ultimate truth of the particular question. This also helps me to avoid burdening the helpdesk with stupid questions. I realized that this was not a stupid question, and so I submitted my trouble ticket, when I saw that neither lescor nor Htrader nor anybody else could figure out this thing. So now I guess we'll have to look to the help desk for an answer.
 
It's been a while since I looked at the unbundled comm schedule, but I thought you needed to be a big trader and provide a lot of liquidity for it to pay. Did I miss something, or why are you using this method?
 
Quote from fhl:

It's been a while since I looked at the unbundled comm schedule, but I thought you needed to be a big trader and provide a lot of liquidity for it to pay. Did I miss something, or why are you using this method?
More...

No, fhl,

one of the really great things about the new unbundled commission schedule is that even a small trader can take advantage of it and benefit from it, if a sufficiently large proportion of his orders are offering liquidity instead of taking liquidity.
 
You calculated your proper comm at $1.10. Bundled, it would be $1.00. That was 100% of your orders. You would need to get to the next volume breakpoint to lower your unbundled comm below $1.00. Please show a calculation if you can beat this with small volume.
 
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